The British continuously changed their economic policy in India. Colonial rule in India may be said to have begun after the battle of Plassey. Prior to this the British Trading Company used to bring goods or precious metals which were exchanged for Indian goods to be sold abroad.

In fact, the Company used to net huge profit by selling Indian goods in the foreign markets. But under one impact of the colonial rule the Indian artisan industries were ruined. The Industrial Revolution in Britain in mid-eighteenth century compelled the Company to change its economic policy.

India now was transformed into a country that produced raw materials to be purchased at a cheap price by the British. At the same time the finished articles from Britain were dumped to the Indian markets.